Legal Question in Bankruptcy in North Dakota

2nd & 3rd mortgage holder

I did a 2nd & 3rd mortgage for a couple with a total of $46,000 combined. I was told by their mortgage company (Pavillion Capital Group) that my 2nd & 3rd mortgage was no different than the 1st. Well, this couple filed Chapter 7 and surrendered the home. the 1st mortgage holder is foreclosing on the home. My 2nd & 3rd mortgage are totally wiped out. With all the interest, late payments, back taxes, etc..there is so little equity left that redemption or bidding on the house at the Sheriff''s auction would not be worth the risk. I just received a letter in the mail from the US Bankruptcy court District of ND, ''Notice of Chapter 7 Case Closed Without Discharge.'' In the letter it states, ''All creditors & parties in interest are notified that the above-captioned case has been closed without entry of discharge as Debtor did not file proof of completion of Instructional Course Concerning Personal Financial Management. If the debtor(s) subsequently files a Motion to Reopen the case to allow for the filing of the financial Management Certificate, the Debtor(s) must pay the full filing fee due. What does this mean? And is there a window of opportunity to recourse for myself like a judgment for the $46,000 they owe me? I am just sick.


Asked on 6/14/08, 7:44 pm

1 Answer from Attorneys
Nancy Delain Delain Law Office, PLLC

Re: 2nd & 3rd mortgage holder

This is one of the big potholes of self-representation that has come into being since the 2005 Bankruptcy Abuse Prevention Act came in. It is things like this that make hiring an attorney to represent you in bankruptcy well worth the money you pay the attorney.

Your case has been dismissed, and none of your debts have been discharged. This means that creditors can come after you again just as if you had never filed your bankruptcy petition. However, your case has been dismissed for a reason that will be easy for the ATTORNEY that you WILL HIRE to fix, with your cooperation.

Your ATTORNEY will have to do a little dancing with your case before the court and you will have to pay the filing fee for the case all over again to the court. You will have some homework to do that the ATTORNEY whom you WILL NOW HIRE will tell you all about. It's easy homework; most of my clients regard it as just a hoop to jump through.

You have only a limited timeframe in which to get this fixed, so get cracking and hire that lawyer. Check with your county or state bar association if you need a referral. Or, if your income is low enough to qualify, get cracking and contact your state/county legal aid agency to see about getting free/low-cost legal help.

MORAL: Don't try bankruptcy on your own; it's just too full of administrative potholes like the one you encountered. The President did not do debtors a favor when he signed the 2005 Bankruptcy Abuse Prevention Act.

CAVEAT: I AM ADMITTED IN NOT NORTH DAKOTA (FROM WHENCE THIS QUESTION COMES), BUT IN NEW YORK.

THE INFORMATION PRESENTED HERE IS GENERAL IN NATURE AND IS NOT INTENDED, NOR SHOULD IT BE CONSTRUED, AS LEGAL ADVICE. THIS POSTING DOES NOT CREATE ANY ATTORNEY-CLIENT RELATIONSHIP BETWEEN US. FOR SPECIFIC ADVICE ABOUT YOUR PARTICULAR SITUATION, CONSULT YOUR ATTORNEY.

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Answered on 6/14/08, 8:30 pm


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